Which of the Following Is True of Private Placement of Securities

question 55

Multiple Choice

Which of the following is true of private placement of securities?

• A)Securities are placed with few large institutional investors.
• B)Securities of private firms are sold to the investing public at lower prices.
• C)The securities must be registered with the SEC.
• D)Public trading in these securities is not allowed.

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Definitions:

Representativeness Heuristic

The representativeness heuristic is a cognitive bias where individuals judge the probability or frequency of a hypothesis by considering how much the hypothesis resembles available data.

Base-Rate Effect

A cognitive error whereby people judge the likelihood of an event by intuitive examples rather than by statistical evidence.

Availability Heuristic

A cognitive shortcut based on the first examples that appear in someone's thoughts when assessing a certain topic, idea, strategy, or choice.

Related Concepts

Ideas, terms, or phenomena that share common features or are associated with each other within a specific context or field of study.